As Congress Deliberates, States Lead the Way on AI Regulation
Will Clark, a Fellow of The National Conference of State Legislatures (NCSL), spoke at NCSL Base Camp 2026 about the volume of state-level bills on AI governance. He noted that, “In 2025, we had 1,262 (state) bills introduced, 227 enacted and adopted. And this year [2026], we had 1,539 introduced and 280 enacted as of (early October).” Notably, AI legislation has been a bipartisan effort at the state level.
“Deepfake bills were the most common type of AI legislation enacted in 2026, typically regulating explicit content, political advertising and use of digital likenesses. Other subjects of this year’s enacted bills include AI in healthcare and education.
“Only two comprehensive AI bills were enacted in 2026, one in Colorado (SB 189) and the other in Connecticut (SB 5). Legislation targeting the big players’ frontier models was more common, including an Illinois bill on mandated third-party audits (SB 315) and one in New York on safety and transparency requirements (SB 8828).”
Although many state bills regulated AI use within the public sector and many were designed to protect minors and other vulnerable populations, a number were still relevant to the financial sector. The NCSL tracks relevant AI bills in its AI Legislation Database.
Why It Matters:
Clark stated that “A lot of the same ideas that get a lot of focus from the states are now being seriously deliberated by Congress.” Financial services organizations can look at state-level regulations to proactively align their compliance posture with inevitable regulatory frameworks.
OCC Finalizes GENIUS Act Implementation Regulations effective January 18, 2027
Link: https://www.occ.gov/news-issuances/bulletins/2026/bulletin-2026-50.html
The OCC issued its final rule implementing the US Stablecoins (GENIUS) Act regarding the issuance of payment stablecoins and certain related activities by entities subject to the OCC’s jurisdiction. The final rule applies to:
- National banks, federal savings associations federal branches (including their subsidiaries)
- Foreign payment stablecoin issuers
- Nonbank entities that seek to be or are approved as federal qualified payment stablecoin issuers
- State qualified payment stablecoin issuers for whom the OCC has regulatory or enforcement authority pursuant to the GENIUS Act
The final rule addresses all of the regulations the OCC is required to promulgate under the GENIUS Act other than those related to the Bank Secrecy Act, anti-money laundering, and Office of Foreign Assets Control sanctions, which will be addressed in a separate rulemaking in coordination with the Department of the Treasury.
Why It Matters:
Organizations involved in stablecoin should be having discussions about whether and what provisions of the new regulations apply.
Digital Fairness Act Expected To Be Adopted in Coming Weeks
Link: https://iapp.org/news/a/a-view-from-brussels-final-countdown-to-the-digital-fairness-act-has-started
Proposed in 2025, The EU’s proposed Digital Fairness Act is on the legislative track and expected to be adopted in the coming weeks. If adopted, it could strengthen consumer protection while adding complexity to the EU’s digital rulebook. Its goal was to clarify what is and is not allowed online. The four core issues were originally expected to be dark patterns, influencer marketing, addictive design, and problematic personalization exploiting consumer vulnerabilities. The DFA will also address additional issues that have emerged since the rule originated, such as unfair ticketing for live events.
Why It Matters:
“Despite a Brussels’ ambition to streamline the EU digital rulebook, the DFA could be a complexifying factor for many organizations. First, many of the areas it is set to address are already covered by existing rules, be it the Artificial Intelligence Act, the Digital Services Act, or the horizontal 2011 Consumer Rights Directive.
“Second, the current picture is also evolving. The DFA will be negotiated in parallel to the recent EU Kids Act proposal on online protection for minors; minors will logically cross with the ‘consumer vulnerabilities’ categories the DFA seeks to address. Ensuring consistency with other laws will be a massively important priority for the co-legislators.”
